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Property A Case + Legislation
Property Law (LAW 2112)
Monash University
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Legislation Case
Topic 7
ACQUISITION AND TRANSFER OF PROPRIETARY INTERESTS; SALE
AND GIFT of PROPERTY
A: Transfer of Proprietary Interest
1 Formal Requirements to Transfer a Legal Interest in Land
What are the formal requirements for the transfer of a legal interest in land? (Note that these formalities apply to all interests in land, except those specifically excepted.) Property Law Act 1958 S 51 - Lands Lie in Grant only (1) All lands and all interests therein shall lie in grant and shall be incapable of being conveyed by livery or livery and seisin, or by feoffment, or by bargain and sale; and a conveyance of an interest in land may operate to pass the possession or right to possession thereof, without actual entry, but subject to all prior rights thereto.
(2) The use of the word "grant" is not necessary to convey land or to create any interest therein.
S 51 - Conveyance to be by deed (1) All conveyances of land or of any interest therein are void for the purpose of conveying or creating a legal estate unless made by deed.
(2) This section shall not apply to— a. assents by a personal representative17; b. disclaimers made in accordance with the provisions of any law relating to bankruptcy or insolvency18 or not required to be evidenced in writing; c. surrenders by operation of law, including surrenders which may, by law, be effected without writing; d. leases or tenancies or other assurances not required by law to be made in writing; e. receipts not required by law to be under seal; f. vesting orders of the Court or other competent authority; g. conveyances taking effect by operation of law.
What is a deed? Property Law Act 1958 S 73 - Execution of deeds by an individual (1) Where an individual executes a deed, he shall either sign or place his mark upon the same and sealing alone shall not be deemed sufficient.
(2) This section shall apply only to deeds executed after the commencement of this Act.
S 73A - Sealing of deeds An instrument executed by an individual on or after the date of commencement of section 4 of the Property Law (Deeds) Act 1977 expressed to be sealed by that individual but not so sealed shall for all purposes operate and take effect as if it had been so sealed.
In the case of Torrens system land, the registration of a transfer takes the place of the deed required by PLA s 52 Transfer of Land Act 1958 S 40 - Instrument not effectual until registered (1) Subject to this Act no instrument until registered as in this Act provided shall be effectual to create vary extinguish or pass any estate or interest or encumbrance in on or over any land under the operation of this Act, but upon registration, the estate or interest or encumbrance shall be created varied extinguished or pass in the manner and subject to the covenants and conditions specified in the instrument or by this Act prescribed or declared to be implied in instruments of a like nature.
What is the effect of a failure to satisfy the formal requirements for the transfer of a legal interest in land (the proprietary effect of contracts)? ● Lysaght v Edwards (1876) ● Bunny Industries Ltd v FSW Enterprises Pty Ltd [1982] ● Tanwar Enterprises Pty Ltd v Cauchi [2003]
2 Gifts of Real & Personal Property
In the case of land under the Torrens system, a registered document is necessary to pass legal title. Thus, an effective gift of Torrens title land will require registration of the transfer of land. An effective gift of general law land requires execution of a deed.
We have also seen that a specifically enforceable contract of sale of land gives rise to an equitable interest in that land, ie while the vendor retains legal title the purchaser acquires an equitable interest in the land. The principle in Lysaght v Edwards cannot apply to an attempted gift of land since, by definition, there is no specifically enforceable contract.
In some cases, a person intending to make a gift may go some way towards carrying out that intention. For example, a person wishing to make a gift of Torrens system land may execute a transfer and hand it over to the donee. The question is whether, in certain circumstances the donee may acquire an equitable interest before the legal interest passes. If so, this is an example of an equitable interest passing without the parties specifically intending to create it.
● Re Stoneham [1919] ● Thomas v The Times Book Co Ltd [1966]
B: Sale of Land
(3) A notice under subsection (2) must, within 3 clear business days after the purchaser has signed the contract— a. be given to one of the following persons— (i) the vendor; (ii) an agent of the vendor; (iii) an estate agent engaged or appointed by the vendor to sell the land; or b. be left at one of the following addresses— (i) the address for service of the vendor specified in the contract; (ii) the address of the vendor's agent; (iii) the address of the estate agent engaged or appointed by the vendor to sell the land.
(4) Where a contract for the sale of land has been terminated in accordance with the provisions of this section the purchaser shall be entitled to the return of all moneys paid by him under that contract except for the sum of $100 or 0·2 per centum of the purchase price (whichever is the greater) which may be retained by the vendor.
(5) This section does not apply to a contract for the sale of land where— a. the sale is by publicly advertised auction; b. the land is sold— (i) within three clear business days before the day on which a publicly advertised auction for the sale of that land is to be held; (ii) on the day on which a publicly advertised auction for the sale of that land is held; or (iii) within three clear business days after the day on which a publicly advertised auction for the sale of that land was held; c. the vendor and purchaser have previously entered into a contract for the sale of the same land in substantially the same terms; d. the purchaser is an estate agent within the meaning of the Estate Agents Act 1980 or a corporate body.
(6) A contract to which this section applies shall contain a conspicuous notice advising the purchaser that he may before the expiration of three clear business days after he signs the contract give notice that he wishes to terminate the contract.
(7) Where a contract to which this section applies does not contain the notice required by subsection (6) the purchaser may rescind that contract at any time before he becomes entitled to possession or to the receipt of rents and profits.
(8) Any provision in the contract or in any other document whereby any right conferred by this section on the purchaser is excluded, modified or restricted shall be void and of no effect.
S 32 - Statement of matters affecting land being sold (1) A vendor under a contract for the sale of land must give to a purchaser, before the purchaser signs the contract, a statement signed by the vendor that contains the matters and attaches the documents specified in this Division.
(2) For the purposes of subsection (1), a vendor may sign the statement to be given to a purchaser under this section by electronic signature.
S 32A - Financial matters in respect of the land to be disclosed in section 32 statement A section 32 statement must contain the following financial matters in respect of the land— a. particulars of any mortgage (whether registered or unregistered) over the land, which is not to be discharged before the purchaser becomes entitled to possession or to the receipt of rents and profits, including the particulars specified in Schedule 1; b. particulars of any charge (whether registered or not) over the land imposed by or under an Act to secure an amount due under that Act, including the amount owing under the charge; c. in any case— (i) the amount of any rates, taxes, charges or other similar outgoings affecting the land and any interest payable on any part of those rates, taxes, charges or outgoings which is unpaid including any rates, taxes, charges or outgoings for which the purchaser may become liable in consequence of the sale and which the vendor might reasonably be expected to have knowledge of; or (ii) a statement that the total amount of those rates, taxes, charges or other similar outgoings and interest does not exceed the amount specified; d. in the case of a terms contract where the purchaser is obliged to make 2 or more payments to the vendor after the execution of the contract and before the purchaser is entitled to a conveyance or transfer of the land, the information set out in Schedule 2.
S 32B - Insurance details in respect of the land to be disclosed in section 32 statement A section 32 statement must contain the following insurance details in respect of the land— a. if the contract for the sale of the land does not provide for the land to remain at the risk of the vendor until the purchaser becomes entitled to possession or receipt of rents and profits, particulars of any policy of insurance maintained by the vendor in respect of any damage to or destruction of the land; b. if there is a residence on the land which was constructed within the preceding 6 years and section 137B of the Building Act 1993 applies to the residence, particulars of any required insurance under that Act applying to that residence.
S 32C - Matters relating to land use to be disclosed in section 32 statement A section 32 statement must contain the following matters in relation to the use of the land— a. a description of any easement, covenant or other similar restriction affecting the land (whether registered or unregistered) and particulars of any existing failure to comply with the terms of that easement, covenant or restriction; b. if the land is in an area that is designated as a bushfire prone area under section 192A of the Building Act 1993, a statement that the land is in such an area; c. if there is no access to the property by road, a statement that there is no such access; d. in the case of land to which a planning scheme applies a statement specifying— (i) the name of the planning scheme; (ii) the name of the responsible authority;
S 32G - Growth areas infrastructure contribution details to be disclosed in section 32 statement (1) A section 32 statement must specify whether the land, in accordance with a work-in-kind agreement (within the meaning of Part 9B of the Planning and Environment Act 1987), is— a. land that is to be transferred under the agreement; or b. land on which works are to be carried out under the agreement (other than Crown land); or c. land in respect of which a growth areas infrastructure contribution is imposed.
(2) The following certificates or notices must be attached to a section 32 statement in the case of land in respect of which there is a GAIC recording (within the meaning of Part 9B of the Planning and Environment Act 1987)— a. any certificate of release from liability to pay a growth areas infrastructure contribution imposed in respect of the land issued under that Part; b. any certificate of deferral of the liability to pay the whole or part of a growth areas infrastructure contribution imposed in respect of the land issued under that Part; c. any certificate of exemption from liability to pay a growth areas infrastructure contribution imposed in respect of the land issued under that Part; d. any certificate of staged payment approval; e. any certificate of no GAIC liability relating to the land issued under that Part; f. any notice given under that Part providing evidence of the grant of a reduction of the whole or part of the liability to pay a growth areas infrastructure contribution imposed in respect of the land or an exemption from that liability; g. if no certificate or notice of a type specified in paragraphs (a) to (f) is provided, a GAIC certificate relating to the land issued under that Part.
S 32H - Disclosure of non-connected services in section 32 statement A section 32 statement must specify if any of the following services are not connected to the land— a. electricity supply; b. gas supply; c. water supply; d. sewerage; e. telephone services.
S 32I - Evidence of title required to be disclosed in section 32 statement The following documents must be attached to a section 32 statement— a. in the case of land under the Transfer of Land Act 1958, a copy of the Register Search Statement and the document, or part of the document, referred to as the diagram location in the Register Search Statement that identifies the land and its location; b. in any other case, a copy of— (i) the last conveyance in the chain of title to the land; or (ii) any other document which gives evidence of the vendor's title to the land; c. if the vendor is not the registered proprietor of the land or the owner of the estate in fee simple in the land, evidence of the vendor's right or power to the sell the land; d. in the case of land that is subject to a subdivision—
(i) if the plan of subdivision has not been registered, a copy of the plan of subdivision which has been certified by the relevant municipal council; or (ii) if the plan of subdivision has not yet been certified, a copy of the latest version of the plan; e. in the case of land that is part of a staged subdivision within the meaning of section 37 of the Subdivision Act 1988— (i) if the land is in the second or a subsequent stage, a copy of the plan for the first stage; and (ii) details of any requirements in a statement of compliance relating to the stage in which the land is included that have not been complied with; and (iii) details of any proposals relating to subsequent stages that are known to the vendor; and (iv) a statement of the contents of any permit under the Planning and Environment Act 1987 authorising the staged subdivision; f. in the case of land that is subject to a subdivision and in respect of which a further plan within the meaning of the Subdivision Act 1988 is proposed— (i) if the later plan has not been registered, a copy of the plan which has been certified by the relevant municipal council; or (ii) if the later plan has not yet been certified, a copy of the latest version of the plan.
S 32J - Information required for a section 32 statement contained in a certificate, notice, policy of insurance or other document (1) If any information required to be contained in a section 32 statement is specified in a certificate, notice or other document issued by a relevant authority, the vendor may attach that certificate, notice or other document (or a copy of that certificate, notice or other document) to the section 32 statement for the purpose of complying with the relevant provision of this Division requiring the information.
(2) If the information required under section 32B is contained in a policy of insurance, the vendor may attach a copy of the policy or an extract of the policy to the statement for the purpose of complying with that section.
S 32K - Supply of false information or failure to supply information in section 32 statement or failure to supply section 32 statement may result in rescission (1) This section applies if a vendor— a. supplies false information to a purchaser in a section 32 statement or in any certificates, notices, policies or other documents attached to a section 32 statement for the purposes of complying with the requirements of this Division; or b. fails to supply all the information required to be supplied to a purchaser, either in a section 32 statement or attached to the section 32 statement, as required by this Division; or c. fails to give a purchaser a section 32 statement signed by the vendor before the purchaser signs the contract for the sale of land.
(2) The purchaser may rescind any contract for the sale of land which has been entered into on the basis of information contained in the section 32 statement or attached to the section 32 statement at any time before the purchaser accepts title and becomes entitled to possession or to the receipt of rents and profits.
To avoid doubt, an agreement to transfer a forest carbon right within the meaning of the Climate Change Act 2010 is not a contract for the sale of land for the purposes of this Division.
Division 2A—Due diligence checklist S 33 - Definitions In this Division— - vacant residential land means any vacant land on which the building of a residence is permitted.
S 33A - What is a due diligence checklist? A due diligence checklist is a checklist prepared for prospective purchasers of vacant residential land or land on which there is a residence to assist purchasers in identifying information they may wish to obtain in respect of the land for sale.
S 33B - Due diligence checklist to be made available (1) A vendor offering land for sale that is vacant residential land or land on which there is a residence must ensure that a due diligence checklist is made available to any prospective purchaser from the time the land is offered for sale.
Penalty: 60 penalty units.
(2) A vendor must ensure that the due diligence checklist is in the form approved by the Director of Consumer Affairs Victoria.
Penalty: 60 penalty units.
(3) Subsections (1) and (2) do not apply to a vendor if the vendor has engaged a person who is a licensed estate agent to act for the vendor.
(4) A person who is a licensed estate agent and acting for a vendor, offering land for sale that is vacant residential land or land on which there is a residence, must ensure that a due diligence checklist is made available to any prospective purchaser from the time the land is offered for sale.
Penalty: 60 penalty units.
(5) A person who is a licensed estate agent and acting for a vendor, must ensure that the due diligence checklist is in the form approved by the Director of Consumer Affairs Victoria. Penalty: 60 penalty units
(6) For the purposes of this section, a due diligence checklist is made available if— a. copies of the due diligence checklist are on display or offered to prospective purchasers at any inspection held of the land; and b. any Internet site maintained by the vendor and any person acting as the licensed estate agent of the vendor where the land is offered for sale allows access to a copy of the due diligence checklist either directly or by linking to another Internet site where a copy may be obtained.
S 33C - Due diligence checklist to be published on Internet The Director of Consumer Affairs Victoria must publish a copy of the due diligence checklist approved by the Director under section 33B on the Internet site for Consumer Affairs Victoria.
Division 3—Insurance S 34 - Power of purchaser to rescind contract where house destroyed (1) Where a contract for the sale of land upon which there is a dwelling-house has been entered into, and where the dwelling-house is so destroyed or damaged as to be unfit for occupation as a dwelling-house, before the purchaser becomes entitled to possession or to the receipt of rents and profits he may, at his option, rescind the contract by notice in writing given to the vendor or his legal practitioner or conveyancer within fourteen days after the purchaser becomes aware of the destruction of or damage to the dwelling-house
(2) Upon rescission of a contract for the sale of land pursuant to this section— a. any moneys paid by the purchaser shall be refunded to him; b. b. any documents of title or transfer shall be returned to the vendor; and c. the provisions of section 35 shall not apply and the vendor and any other person entitled to benefit from any insurance policy shall be entitled to do so to the same extent as they would have been if the land had not been subject to the contract.
(3) Any provision in any contract for the sale of land or other document whereby any provision of this section is excluded, modified or rescinded shall be void and of no effect.
S 35 - Insurance held by vendor to enure for benefit of purchaser (1) During the period between the making of a contract for the sale of land and the purchaser becoming entitled to possession or to the receipt of rents and profits pursuant to the terms of the contract, any policy of insurance maintained by the vendor in respect of any damage to or destruction of any part of the land agreed to be sold pursuant to the contract shall in respect of the said land, to the extent that the purchaser is not entitled to be indemnified under any other policy of insurance, enure for the benefit of the purchaser as well as for the vendor and the purchaser shall be entitled to be indemnified by the insurer under any such insurance policy in the same manner and to the same extent as the vendor would have been if the land had not been subject to the contract.
(2) It shall not be a defence or answer to any claim by the purchaser against the insurer made under subsection (1) hereof that the vendor otherwise would not be entitled to be indemnified by the insurer because the vendor has suffered no loss or has suffered diminished loss by reason of the fact that the vendor is entitled to be paid the purchase price or the balance thereof by the purchaser.
(3) A policy of insurance shall not enure for the benefit of a purchaser under subsection (1) hereof if the insurer establishes that a prudent insurer would not have insured the purchaser against the risk covered by the policy.
There are four main different types of leases: 1. a tenancy for a fixed term or term of years 2. a periodic tenancy 3. a tenancy at will 4. a tenancy at sufferance (“holding over”)
B: Characteristics of Leases
Exclusive Possession
What is the distinction between a lease and a licence? Is the right to exclusive possession a distinguishing characteristic? ● Radaich v Smith (1959) ● Street v Mountford [1985] ● Swan v Uecker [2016)
Certainty of Duration
What requirements exist in relation to the duration of leases? ● Lace v Chantler [1944]
D: Leasehold Covenants
The rights & duties of landlord & tenants may derive from a number of sources. These include: - Covenants exprressly agreed to between the parties - Covenants implied by statute - Covenants implied by the common law
Covenants contained in leases often include: - a covenant to pay rent - a covenant to repair - a covenant not to assign or sub-let the premises without the prior consent of the landlord (see below) - a covenant restricting the use of the premises
Covenants implied by the common law
- Implied condition of fitness for human habitation at the commencement of the lease
- Implied covenant for quiet enjoyment ● Hawkesbury Nominees Pty Ltd v Battik Pty Ltd [2000]
- Implied obligation not to derogate from the grant ● Aussie Traveller Pty Ltd v Marklea Pty Ltd [1998] ● Nordern v Blueport Enterprises [1996]
Implied obligations of the tenant
- Implied covenant to use the premises in a tenant-like manner
- Implied duty not to commit waste
- Implied covenant to yield up possession.
Covenants implied into leases by statute
Residential tenancies: The rights and obligations of landlords and tenants in relation to residential premises are regulated by the RTA. -
Retail tenancies: The rights and obligations of landlords and tenants in relation to residential premises are regulated by the RLA.
Transfer of Land Act 1958 S 67 - Covenants to be implied in leases (1) In every instrument of lease under this Division there shall be implied the following covenants and powers— a. that the lessee will pay the rent reserved by the lease at the times therein mentioned and all rates and taxes which may be payable in respect of the leased property during the continuance of the lease, except in so far as the same are or shall be payable exclusively by the owner of the property under any Act now or hereafter in force relating to local government; b. that the lessee will keep and yield up the leased property in good and tenantable repair, accidents and damage from storm and tempest and reasonable wear and tear excepted; c. that the lessor may with or without surveyors workmen or others once in every year during the term at a reasonable time of the day enter upon the leased property and view the state of repair thereof; d. that if the rent or any part thereof is in arrear for the space of one month, although no legal or formal demand has been made for payment thereof, or in case of any breach or non-observance of any of the covenants expressed in the lease or by this Act declared to be implied therein on the part of the lessee and such breach or non-observance continuing for the space of one month, it shall be lawful for the lessor to re-enter upon and take possession of the leased property.
(2) In every transfer of a registered lease (including a Crown lease) there shall be implied a covenant with the transferor by the transferee binding him thenceforth to pay the rent by the lease reserved, and perform and observe all the covenants contained in the lease or by this Act declared to be implied in the lease and on the part of the lessee to be performed and observed, and to indemnify the transferor against all actions suits claims and expenses in respect of the non-payment of such rent or the breach or non-observance of such covenants or any of them.
S 71(4) In addition to the covenants specified by this Act to be implied in leases, there shall be implied in every sub-lease under this Act a covenant that the sub-lessor will during the term thereby granted pay the rent reserved by and perform and observe the covenants and
S 77 - Implied covenants in conveyances subject to rents (1) In addition to the covenants implied under the last preceding section, there shall in the several cases in this section mentioned, be deemed to be included and implied, a covenant to the effect in this section stated, by and with such persons as are hereinafter mentioned, that is to say— a. in a conveyance for valuable consideration, other than a mortgage, of the entirety of the land affected by a rentcharge, a covenant by the grantee or joint and several covenants by the grantees, if more than one, with the conveying parties and with each of them, if more than one, in the terms set out in Part VII of the Fourth Schedule to this Act. Where a rentcharge has been apportioned in respect of any land, with the consent of the owner of the rentcharge, the covenants in this paragraph shall be implied in the conveyance of that land in like manner as if the apportioned rentcharge were the rentcharge referred to, and the document creating the rentcharge related solely to that land; b. in a conveyance for valuable consideration, other than a mortgage, of part of land affected by a rentcharge, subject to a part of that rentcharge which has been or is by that conveyance apportioned (but in either case without the consent of the owner of the rentcharge) in respect of the land conveyed— (i) a covenant by the grantee of the land or joint and several covenants by the grantees, if more than one, with the conveying parties and with each of them, if more than one, in the terms set out in paragraph (i) of Part VIII of the Fourth Schedule to this Act; (ii) a covenant by a person who conveys or is expressed to convey as beneficial owner, or joint and several covenants by the persons who so convey or are expressed to so convey, if at the date of the conveyance any part of the land affected by such rentcharge is retained, with the grantees of the land and with each of them (if more than one) in the terms set out in paragraph (ii) of Part VIII of the Fourth Schedule to this Act; c. in a conveyance for valuable consideration, other than a mortgage, of the entirety of the land comprised in a lease, for the residue of the term or interest created by the lease, a covenant by the assignee or joint and several covenants by the assignees (if more than one) with the conveying parties and with each of them (if more than one) in the terms set out in Part IX of the Fourth Schedule to this Act. Where a rent has been apportioned in respect of any land, with the consent of the lessor, the covenants in this paragraph shall be implied in the conveyance of that land in like manner as if the apportioned rent were the original rent reserved, and the lease related solely to that land; d. in a conveyance for valuable consideration, other than a mortgage, of part of the land comprised in a lease, for the residue of the term or interest created by the lease, subject to a part of the rent which has been or is by the conveyance apportioned (but in either case without the consent of the lessor) in respect of the land conveyed— (i) a covenant by the assignee of the land, or joint and several covenants by the assignees, if more than one, with the conveying parties and with each of them, if more than one, in the terms set out in paragraph (i) of Part X of the Fourth Schedule to this Act; (ii) a covenant by a person who conveys or is expressed to convey as beneficial owner, or joint and several covenants by the persons who so convey or are expressed to so convey, if at the date of the conveyance any part of the land
comprised in the lease is retained, with the assignees of the land and with each of them (if more than one) in the terms set out in paragraph (ii) of Part X of the Fourth Schedule to this Act.
(2) Where in a conveyance for valuable consideration, other than a mortgage, part of land affected by a rentcharge, or part of land comprised in a lease is, without the consent of the owner of the rentcharge or of the lessor, as the case may be, expressed to be conveyed— (i) subject to or charged with the entire rent— then paragraph (b)(i) or (d)(i) of the last subsection, as the case may require, shall have effect as if the entire rent were the apportioned rent; or (ii) discharged or exonerated from the entire rent— then paragraph (b)(ii) or (d)(ii) of the last subsection, as the case may require, shall have effect as if the entire rent were the balance of the rent, and the words "other than the covenant to pay the entire rent" had been omitted.
(3) In this section conveyance shall not include a demise by way of lease or rent.
(4) Any covenant which would be implied under this section by reason of a person conveying or being expressed to convey as beneficial owner may, by express reference to this section, be implied, with or without variation, in a conveyance, whether or not for valuable consideration, by a person who conveys or is expressed to convey as settlor, or as trustee, or as mortgagee, or as personal representative of a deceased person, or as committee of a lunatic, or under an order of the Court.
(5) The benefit of a covenant implied as aforesaid shall be annexed and incident to, and shall go with, the estate or interest of the implied covenantee, and shall be capable of being enforced by every person in whom that estate or interest is, for the whole or any part thereof, from time to time vested.
(6) A covenant implied as aforesaid may be varied or extended by deed, and, as so varied or extended, shall, as far as may be, operate in the like manner, and with all the like incidents, effects and consequences, as if such variations or extensions were directed in this section to be implied.
(7) In particular any covenant implied under this section may be extended by providing that— a. the land conveyed; or b. the part of the land affected by the rent-charge which remains vested in the covenantor; or c. the part of the land demised which remains vested in the covenantor— shall, as the case may require, stand charged with the payment of all money which may become payable under the implied covenant.
(8) This section shall apply only to conveyances made after the commencement of this Act.
S 78 - Benefits of covenants relating to land (1) A covenant relating to any land of the covenantee shall be deemed to be made with the covenantee and his successors in title and the persons deriving title under him or them, and shall have effect as if such successors and other persons were expressed. For the purposes
(4) This section shall apply to leases made before or after the commencement of this Act, but shall not affect the operation of— a. any severance of the reversionary estate; or b. any acquisition by conveyance or otherwise of the right to receive or enforce any rent, covenant or provision— effected before the commencement of the Property Law Act 1928.
S 142 - Obligation of lessor's covenants to run with reversion (1) The obligation under a condition or of a covenant entered into by a lessor with reference to the subject-matter of the lease shall, if and as far as the lessor has power to bind the reversionary estate immediately expectant on the term granted by the lease, be annexed and incident to and shall go with that reversionary estate, or the several parts thereof, notwithstanding severance of that reversionary estate, and may be taken advantage of and enforced by the person in whom the term is from time to time vested by conveyance, devolution in law, or otherwise; and if and as far as the lessor has power to bind the person from time to time entitled to that reversionary estate, the obligation aforesaid may be taken advantage of and enforced against any person so entitled.
(2) This section shall apply to leases made before or after the commencement of this Act, whether the severance of the reversionary estate was effected before or after such commencement: Provided that, where the lease was made before the thirty-first day of January One thousand nine hundred and five nothing in this section shall affect the operation of any severance of the reversionary estate effected before the commencement of the Property Law Act 1928. This section shall take effect without prejudice to any liability affecting a covenantor or his estate.
● Spencer’s case (1583) ● Gumland Property Holdings v Duffy Bros Fruit Market (Campbelltown) (2008)
Topic 9
CREATION OF LEASEHOLD INTERESTS
A: Legal Leases
General Law Land: In relation to General Law land, a legal interest, including a legal lease, must be created by deed. However, there is an exception for those leases that may exist under s 54(2) of the PLA. These are leases for a term not exceeding three years, taking effect in possession, at the best rent which can be reasonably obtained without taking a fine. Leases fitting this description are legal, notwithstanding that they are not created by deed.
Transfer to Land Act 1958 S 66(1) - Leases
(1) The registered proprietor of freehold land may lease it for any term exceeding three years by an instrument in an appropriate approved form.
Is the interest of an unregistered lessee of Torrens system land enforceable against a registered proprietor who acquired title from the lessor? Transfer to Land Act 1958 S 42 - Estate of registered proprietor paramount S 42(2)(e): the interest (but excluding any option to purchase) of a tenant in possession of the land
B: Equitable Leases
An equitable lease may be created by specifically enforceable agreement, under the principle of Walsh v Lonsdale, provided the agreement complies with s 126 of the Instruments Act 1958 (Vic) or is enforceable under the doctrine of part performance
Instruments Act 1958 s ● Walsh v Lonsdale (1882) ➔ The principle in Walsh v Lonsdale does not apply in a situation where a contract for the sale of an interest in land (including an agreement for a lease) is not specifically enforceable. Unlike the legal remedy of damages, which is automatically available to a person whose legal right has been infringed, equitable remedies are discretionary. ● Chan v Cresdon Pty Ltd (1989)
The principle in Walsh v Lonsdale does not apply in a situation where a contract for the sale of an interest in land (including an agreement for a lease) is not specifically enforceable. Unlike the legal remedy of damages, which is automatically available to a person whose legal right has been infringed, equitable remedies are discretionary.
Topic 10
THE BORDERLINE BETWEEN CONTRACT AND PROPERTY:
CONTRACTUAL LICENCES
A: Different Types of Licences
3 types: 1. Bare Licence 2. Contractual Licence 3. A Licences coupled with a grant
Property A Case + Legislation
Course: Property Law (LAW 2112)
University: Monash University
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